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Feds say Northwest Trustee knew they illegally foreclosed on active military, veterans

(REAL ESTATE NEWS) The Justice Department alleges that for the past six years, Northwest Trustee opted to knowingly foreclose illegally on active and former military servicemembers.

Three servicemembers standing in uniform representing their ability to pursue homeownership with VA loans.

Obviously foreclosures are heartbreaking and tragic, but what if you had your home taken away from you while you were overseas serving your country? Should be impossible, right?

In exchange for their service, the U.S. federal government protects active duty military from foreclosure under the Servicemembers Civil Relief Act (SCRA). The Act ensures that servicemembers can’t have their houses repossessed while they are actively serving in the military.

According to the U.S. Justice Department, the largest foreclosure trustee in the Pacific Northwest has knowingly violated this law on many occasions over the past six years.

Recently, the Justice Department filed suit in the U.S. District court in Seattle. The case will potentially provide financial compensation for 28 military servicemembers or veterans whose houses were repossessed while they were serving.

The case centers on Jacob McGreevey, a Marine who has served four tours of duty in the Middle East. His Vancouver home was repossessed between his third and fourth tour by Northwest Trustee Services of Bellevue, Washington. It was only several years later that McGreevey found out that he should have been protected by the SCRA.

The Justice Department says that Northwest Trustees did reference a database to see if McGreevey was protected by the Act, and then chose to foreclose on him regardless.

Originally the court had sided with the lender, saying that McGreevey had waited too long to file suit. After McGreevey and his lawyer wrote a complaint, the U.S. Justice Department took up the case. They argue that there is no statute of limitations on the Servicemembers Civil Relief Act. This contradicts state laws.

Legislation may be necessary to reconcile the federal and state laws.

Annette Hayes, U.S. Attorney in the western district of Washington says that their “investigation revealed that Northwest Trustee Services repeatedly failed to comply with laws that are meant to ensure our servicemembers do not have to fight a two-front war – one on behalf of all of us, and the other against illegal foreclosures.”

Sean Riddell, McGreevey’s lawyer and former commanding officer, condemned Northwest Trustee in even harsher terms.

“I want Northwest Trustee and PHH put out of business, their buildings burned down and the ground salted so that nothing ever grows for what they did to veterans,” said Riddell.

Ellen Vessels, a Staff Writer at The American Genius, is respected for their wide range of work, with a focus on generational marketing and business trends. Ellen is also a performance artist when not writing, and has a passion for sustainability, social justice, and the arts.

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